Travels in June to Tanzania and South Africa – and specifically to the TED Global conference in Arusha, and a World Economic Forum meeting in Cape Town – have had me thinking more directly about economic development than I have for the past few years. Specifically, I came out of these conferences amazed by the success of the mobile phone industry in Africa and wondering whether what lessons other sectors could take from the mobile phone industry.
I posited the idea of “incremental infrastructure” as a way to explain the success of the mobile phone industry – the idea that mobile companies were successful because they required modest up-front investment, generated revenue from a small, “atomic” investment and were subsidized in no small part by their users.
Evidently the idea has some legs. Gareth Cook at the Ideas section of the Boston Globe asked me if I would expand the idea for the newspaper – that expansion appears in today’s Ideas section. Gareth did a great job of forcing me to think about the big picture implications of the idea and the possibility that incrementalism could have implications for roads, air travel and other aspects of infrastructure, not just telecoms and power.
Writing for the newspaper – a form in which length is neccesarily constrained – has made me realize that I want to think and write at more length about this idea. The more I look into African approaches to infrastructure, the more I’m starting to think that incrementalism is the norm, not the exception. In failed states, there’s no opportunity for governments to make major infrastructure investments – inasmuch as systems exist, they’ve been built incrementally through modest investments by local entrepreneurs. Airlines in the Democratic Republic Congo are a classic example – they serve the function that a road or railroad system would serve in a luckier nation, and they are provided by “airlines” that frequently hasve assets that are no more than a single airplane. It’s not the transport infrastructure you’d wish for a nation, but it’s better than nothing, and enables commerce that couldn’t happen otherwise.
My friend and colleague Mike Best has challenged me on the idea of whether the examples I’m offering are really “micro” enough. By that definition, he’s most interested in “picoinfrastructure”, ways that small communities can build data infrastructure for a few thousands of dollars, not the single-digit millions I’ve pointed to in my examples from the mobile phone business. The examples Mike is offering mostly outline a model of “self-provisioning”, one where you’re building a network to meet your own needs because no one else has built that infrastructure. Where self-provisioning meets incremental infrastructure, I think, is where you overbuild for your personal needs with the goal of selling that capacity to your neighbors. Mining and oil companies self-provision infrastructure all over the African continent. Visit a gold mining center in Ghana and you’ll find infrastructure that outpaces that in many secondary cities. But that infrastructure isn’t shared and resold – it might be vastly more cost-effective if it were, and would likely address some community concerns about the impact of extractive industries. That said, I can imagine incremental infrastructure being built at mini, micro and pico-levels. A farmer investing in water pumping equipment that could irrigate both his fields and neighboring fields might be builting pico-level incremental infrastructure, while a mobile phone company that built power plants to provide energy to mobile phone base stations, and used excess capacity to run irrigation pumps might be working on a micro or mini scale.
Presenting the idea of incremental infrastructure to doctoral students at a summer session at Harvard raised another set of questions. The European students in the crowd were deeply suspicious of the market focus of incrementalism, and the idea that the government’s role in these proposals was, basically, to get out of the way. One response to this suspicion is to point to the poor record many African nations have had in building large-scale infrastructure, a fact that the African students in the crowd were happy to echo. Another is to suggest that the role for government is to actively get out of the way. The Investment Climate Facility for Africa is beginning to research constraints on operating businesses in African nations and recommend process reforms which make it easier for businesses to be founded and become operational. Governments that wish to encourage incrementalism can begin following these suggestions and changing their business environments.
As Mike suggested in this discussion, the most productive thing governments can do in this space is regulate intelligently. The response to air safety in the DRC is not to dismiss the incremental solution that’s been built up and attempt to replace it with a sole national carrier – it’s to regulate airlines and ensure that anyone flying is meeting minimum safety standards. Intelligent regulation can also prevent the “specter” of multinational dominance the students were worried about – Congo didn’t need to permit Alieu Conteh’s CWN and Vodacom Congo to merge. Had they been concerned about overconsolidation, they could have blocked the merger to encourage competition, or offered more licenses to encourage a third firm to expand in the nation.
Governments and aid agencies might also be able to assist with incrementalist strategies by focusing on remittance. Remittances sometimes create infrastructure on a highly local level – a water pump or generator for a single family, generally. Mexican communities have been experimenting with matching programs that will contribute public dollars or aid dollars to community projects funded via remittance – a worker might choose to send $150 to his family and $50 to a community school fund, especially if he knew the $50 would be matched 3 to 1 to build a school for his children. Matching of remittance for incremental projects has a very different “feel” from taxing remittance – instead of supporting the entire government infrastructure, the monies collected (voluntarily, I’d suggest) are guaranteed to focus in the area a worker wants to see benefit. They’re broader than the familial benefits of traditional remittance, but smaller than the national benefits generated by taxing remittances.
I’m a little wary of overfocusing on the incremental infrastructure idea. I’ve watched my friend Jamais Cascio see his idea of the ecological footprint of a cheeseburger spiral somewhat out of control, to the point where he’s now posted about the ecological footprint of making a TV show to discuss his research on the cheeseburger meme. (How’s that for meta?) But I think there’s a train of thought here worth exploring, and I hope to write something more substantive on this topic later this year. In the meantime, I’d love your reactions to the Globe piece and particularly your ideas for examples of how incrementalism is already working in developing nations, ways in which problems could be solved via incremental approaches, and problems inherent in the incremental infrastructure approach. Think of it as an incremental strategy for making this idea a more robust one. :-)